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Wednesday, September 25, 2013

Insurance officials point out possible flaw if NH decides to expand Medicaid

CONCORD – State insurance officials slammed the brakes Tuesday on a proposed expansion of Medicaid that had bipartisan support on the commission studying the question.

Jennifer Patterson, health care legal counsel for the Insurance Department, said the federal Affordable Care Act would not permit anyone in the target low-income population to buy coverage through a federally run exchange or marketplace in New Hampshire next year. ...

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CONCORD – State insurance officials slammed the brakes Tuesday on a proposed expansion of Medicaid that had bipartisan support on the commission studying the question.

Jennifer Patterson, health care legal counsel for the Insurance Department, said the federal Affordable Care Act would not permit anyone in the target low-income population to buy coverage through a federally run exchange or marketplace in New Hampshire next year.

That’s because the Affordable Care Act requires that anyone who earns up to 138 percent of the federal poverty level, or $16,000 a year, and buys health coverage in the exchange must have a choice of at least two “qualified health plans,” she said.

Anthem Blue Cross and Blue Shield of New Hampshire is the only insurer in the exchange slated to start Jan. 1; Harvard Community Health Plan has expressed some interest, but it cannot enter the market until 2015 at the earliest.

“There has to be a choice of qualified health plans, and that presents a problem, with New Hampshire only having one health plan,” Patterson said. “There could be a concern if we tried to go in 2014.”

Sen. Andy Sanborn, R-Bedford, said he doesn’t understand why the Obama administration would refuse to give New Hampshire a waiver or exemption from this two-plan mandate since Anthem is offering 11 different benefit plan options to individuals who will buy coverage in the exchange.

“That just sounds counterintuitive to me,’’ Sanborn said.

Patterson said she would check with federal officials and get a more firm answer to the commission when it meets twice next week.

The commission has until Oct. 15 to complete its final report to the Legislature.

Gov. Maggie Hassan has said, if necessary, she would call lawmakers back into session later this fall to vote on the expansion so it could begin by Jan. 1.

Last week, six of nine members on the commission voiced support for the concept of letting adults who earn 100-138 percent of federal poverty keep any private health insurance they have, and Medicaid could be used to pay for any benefits required under the new federal health care law that weren’t part of the employer’s insurance plan.

Any of these low-income adults without private insurance would have to then pursue buying it on the exchange. Under this scenario, Medicaid and taxpayers ultimately would be the payer of last resort for the greatest expense for this health care.

Despite this obstacle, there remains a clear majority on the commission to expand Medicaid to cover 22,000 new clients, with a total increased enrollment in Medicaid of nearly 50,000 residents.

All five members appointed by Hassan and House Speaker Terie Norelli, D-Portsmouth, haven’t wavered during nearly three months of public meetings.

The tricky part has been to identify changes needed to lure Sen. Nancy Stiles, R-Hampton, to support a final report next month.

Stiles’ backing is widely viewed as critical because, to this point, all 13 Senate Republicans have voted to block expansion.

Hassan and Norelli, both backers of the expansion, need to find two Senate GOP converts for any plan to prevail.

Stiles offered part of that road map Tuesday, suggesting that any expansion be eliminated if the Obama administration fails to approve needed waivers by July 1.

“We need to have a waiver in hand by July 1, 2014. If we move forward and we don’t get the waiver, it’s gone,” Stiles said. “That gives us more flexibility to get a plan that is New Hampshire-specific.”

Charles Arlinghaus, executive director of the fiscally conservative Josiah Bartlett Center for Public Policy, said he could only support expanding Medicaid for those who earn up to 100 percent of federal poverty, which is $11,500 a year.

Arlinghaus said even among the working poor, New Hampshire is well above the national average in its residents with private health insurance.

“I think there is almost no room on this issue for compromise,” Arlinghaus said.

But state Rep. Cindy Rosenwald, D-Nashua, said federal officials will not let any state expand Medicaid to cover only part of the target population.

If New Hampshire fails to endorse the entire expansion, Rosenwald predicted that the state would receive 50 percent federal support for new clients brought into Medicaid and not the 100 percent federal backing through 2017 that the Affordable Care Act offers.

The Kaiser Foundation reports that 23 states and the District of Columbia have agreed to Medicaid expansion, 21 states turned it down, and New Hampshire is among the remaining six to decide the question.

Over the first seven years, New Hampshire would receive $2.4 billion in federal grants, since it offers at least 90 percent support through 2020.

Rep. Neal Kurk, R-Weare, said starting in 2021, the cost to state taxpayers for benefits and administration would balloon to $36 million a year.

“I really think we need to take a long-term look,” Kurk said.

Kevin Landrigan can reached at 321-7040 or klandrigan@nashuatelegraph.com. Also, follow Landrigan on Twitter (@Klandrigan).